Does it work when the permalink settings are default?
What theme are you using?
URL, so we can see what’s happening?
Tried it without active plugins, or with the default theme?
The code in functions.php should be removed, as it certainly doesn’t solve such problems. It just sets the number of posts on the home page to 1.

If there is a theme setting that alters the number of posts on the home page, as opposed to the default setting in the core options, then try to set this number to the same value.

It may be that your theme is doing something wrong, as using query_posts() in a template. This is a wrong way of doing things. You may use your code in functions.php until you get an update of your theme, but set the value to the number you want (9), not 1.